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Unions Hail Major New Agreement On Tenant Protections

June 12, 2019

By Steve Wishnia

Organized labor helped seal the deal extending new protections to millions of tenants struggling to make rent.

NEW YORK, N.Y.— New York State’s legislative leaders announced June 11 that they had reached agreement on an omnibus bill they said would “give New Yorkers the strongest tenant protections in history.”

The bill would greatly strengthen protections for tenants in the roughly 1 million apartments covered by the state’s rent-stabilization system, more than half of whom make less than $50,000 a year. It would also let local governments outside New York City and Westchester, Nassau, and Rockland counties opt into rent stabilization, which they are currently barred from doing. But it does not include a measure that would have expanded tenant protections to almost all the state’s rental housing, prohibiting landlords from evicting tenants without a specific “good cause” such as not paying their rent.

“For too long, power has been tilted in favor of landlords, and these measures finally restore equity and extend protections to tenants across the state,” Senate Majority Leader Andrea Stewart-Cousins and Assembly Speaker Carl Heastie said in a statement announcing the final version of the bill June 11. “These reforms will pass both legislative houses, and we are hopeful that the Governor will sign them into law.”

A spokesperson for Heastie said both houses are scheduled to vote on the bill June 14.

The bill would close the loopholes in rent regulations the state imposed in the 1990s, which are estimated to have caused the loss of more than 300,000 rent-stabilized apartments. It would repeal the 1997 law that allows landlords to deregulate vacant apartments once the rent gets high enough—currently about $2,775 a month. It would make “preferential rents,” rents below the legal maximum, last as long as the tenant stays in the apartment, so they don’t get hit with a $500 increase when their lease expires. It also would repeal the extra 20% increase allowed on vacant apartments since 1997, and prohibit both the state and local governments from granting rent increases based on how long the tenant had lived in the apartment or how low their rent was.

“Housing Justice for All is proud to stand with the State Legislature as it takes meaningful steps forward to end tenant harassment, displacement, destabilization, and rising rents,” Cea Weaver, campaign director of the Upstate Downstate Housing Alliance, which had advocated a nine-bill “universal rent control” package, said in the Stewart-Cousins/Heastie statement. “This bill is affirmation of the statewide movement that we are building together, and we look forward to working with the Senate and the Assembly, in the years to come, until every renter, from Brooklyn to Buffalo, can live free from the fear of displacement.”

The Alliance’s more than 75 members include DC 37 AFSCME, 1199SEIU, and United Auto Workers Local 2320, which represents Legal Services staff. In May, they were among the 12 unions whose leaders, including state AFL-CIO PresidentMario Cilento, endorsed the package. “Our members—tenants—need protection from unfair and unreasonable rent increases, from unsafe conditions, and from retaliation,” they wrote, adding that the nine bills would expand protections “for nearly 5 million unregulated tenants across the state.”

The real-estate industry, however, was able to stave off the measures it considered most objectionable, including the “good cause” eviction bill. Sponsored by state Sen. Julia Salazar (D-Brooklyn), it would have extended some state protections to tenants in buildings built after rent stabilization was enacted in 1974, smaller than the six-apartment minimum for rent stabilization, or outside its geographical limits. The bill agreed on will also not reregulate the apartments taken out of rent stabilization under the 1997 vacancy-decontrol law.

Landlords also strongly opposed repealing the provisions in the rent-stabilization law that allow permanent rent increases for renovating individual apartments and for building-wide “major capital improvements,” commonly called MCIs. The bill passed would instead have them expire after 30 years. It would limit MCI increases to 2%. Increases for individual apartment improvements, which are largely done on vacant units, would be held to about $83 a month, based on a maximum of $15,000 in work over 15 years.

Landlords’ main argument for preserving those increases was that they have a right to a return on their investment in upgrading their buildings. Some nonunion contractors, working with the real-estate lobby, staged protests saying repeal would cost them jobs. Tenant groups’ argument for repeal was that both types of increases create an incentive to push tenants out, with a common scenario being the landlord fraudulently inflating the cost of the work on a vacant apartment to claim a bigger increase, and the construction being done in a way intended to encourage the remaining rent-stabilized tenants to leave.

The Senate majority had endorsed both good-cause eviction and MCI repeal, while the Assembly did not include good-cause eviction in the eight-bill package Heastie presented in April. Gov. Andrew Cuomo opposed repeal of renovation increases, blaming the Senate for delays in renewing the rent-stabilization laws and implying that Democrats from upstate and Long Island who backed the full “universal rent control” package would have trouble in the next election. 

The governor said last week that he would sign whatever the Legislature passes, however.

Other provisions in the bill would reduce the maximum increases for the about 22,000 remaining rent-controlled apartments from 7.5% a year to parallel the lower hikes permitted by local rent guidelines boards. It would also limit increases in trailer parks to 3-6% a year unless the landlord can prove hardship. That is an issue in upstate areas, where private-equity funds have been buying up mobile-home communities.

It also contains several measures intended to beef up the state’s notoriously weak enforcement against illegal rent overcharges. It would extend the statute of limitations on them from four years to six or more “as reasonably necessary,” and mandate that the state housing agency submit an annual report on what it’s doing to enforce the law. It would require that 25% of applications for MCIs be inspected and audited. Other provisions would give tenants facing eviction, including those in unregulated units, more time to find a lawyer or come up with back rent, and bar the use of “tenant blacklists,” court-record databases of those who have sued their landlord for repairs or gone on rent strike long enough to get an eviction notice for nonpayment.

A subtle but crucial change is that the bill would also make rent regulations permanent, instead of having to be renewed every four to eight years. That need for renewal was what enabled Senate Republicans and then-Gov. George Pataki to enact loopholes like vacancy decontrol in 1997 and 2003, by threatening to let the law expire if the Assembly didn’t agree to those changes.

“None of these historic new tenant protections would be possible without the fact that New York finally has a united Democratic legislature,” Stewart-Cousins and Heastie said.

The Assembly passed measures to repeal vacancy decontrol, the 20% vacancy bonus, and other elements of the 1997 law several times over the past decade, but they never made it out of committee in the Republican-controlled Senate. That obstacle was cleared away in last year’s elections. In September, six of the eight members of the Independent Democratic Conference, Democratic senators who allied with Republicans to ensure their control of committee chairs and which bills get to the floor, were unseated in primaries by candidates running on pro-tenant platforms. In November, Democrats won a 39-24 majority in the Senate, giving them control of the state’s upper house for the first time since 1966.

June 12, 2019

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